Chinese telecom company Huawei Technologies has just got security clearance to manufacture telecoms equipment in India, paving the way for it to become the first major Chinese brand to supply locally made products for one of the world’s biggest markets for mobile phones.
The green light from the Ministry of Home Affairs, confirmed by an official on Wednesday, comes 19 months after Huawei first applied for a manufacturing licence, amid wrangling over national security concerns. It also marks a significant boost for Prime Minister Narendra Modi’s ‘Make in India’ campaign.
The security clearance for Huawei’s proposed unit for electronics/telecom hardware and support services, including trading and logistics activities marks a major policy shift with regard to Chinese investment in telecom. Until now, security agencies had been stonewalling FDI proposals from Chinese telecom firms, citing risks such as espionage using embedded malware as well as alleged PLA link in their ownership or shareholding pattern.
Huawei’s clearance to manufacture telecoms gear comes as a number of China’s largest phone makers, including Huawei itself, have indicated they are keen to supply locally made products to India’s fast-growing mobile market, which has more than 975 million mobile phone subscriptions.
Recently, Foxconn Technology Group has started making and shipping smartphones for China’s Xiaomi and US phone brand InFocus at its new plant in Andhra Pradesh, taking a step forward towards making India its next manufacturing hub.
Chinese smartphone leader Xiaomi has publicly shared its plans to make phones from India but India head Manu Jain said the company is still finalising its manufacturing plans, when asked whether it was getting smartphones made from Foxconn’s new unit.
